As you age, there’s a chance that you’ll need to seek around-the-clock care in a nursing home. Many people discover that this is a challenging aspect to aging because they never took the time to plan for their long-term care needs. There are several things that you need to know about this aspect of estate planning.

One of the most important things to know is that you can’t start long-term care planning at the last minute. If there is a chance that you’re going to need Medicaid to help cover some of the care you receive, you must start planning more than five years in advance. This is because there is a five-year look-back period for this coverage.

The look-back period is that amount of time that the reviewer can scrutinize your financial decisions. The five years goes back from the date that you’re determined to be eligible for Medicaid. Any assets that you sold or gave away during that period can count against you during the determination of your benefits. Any assets that you’re going to leave to your loved ones and any gifting you need to do to pay down the estate must be finished prior to the look-back period.

In order to receive Medicaid, you also have to meet income and asset guidelines. As of 2020, you can’t have more than $2,000 in countable resources if you’re a single person or $3,000 if you’re married. The income limit for single people or married couples is $2,313 per month.

You do have options, including using special trusts like the qualified income trust, to meet the limits required. These should be established well in advance of your need for coverage.